China property sales tax sparks rush to divorce

SHANGHAI, AFP-JIJI – Chinese couples are flocking to divorce to avoid a new property sales tax imposed by the government, after it left open a loophole for those who end their marriages.

Government marriage registration offices — which also handle divorces — were swamped by scores of couples trying to untie the knot, one newly separated woman said Wednesday as she headed off to sell a property.

China’s central government last Friday issued rules to rein in housing prices, including a nationwide capital gains tax of 20 percent on profits owners make from selling residential property. But the terms allow couples with two properties who divorce and put each house into one person’s name to then sell them tax-free under certain conditions, after which they can remarry, state media said.

Those divorcing in Shanghai included at least one pregnant woman, the Shanghai Daily said. “She told me she came here to avoid the possible loss in a property transaction, and I could say nothing,” the newspaper quoted a harried official at another registry as saying. “I told all of them to come here again for remarriage registration.”